[go: up one dir, main page]
Scribd
Upload
34 views1 page

Engineering Economics Examples

Uploaded by

Lopoe Miyao
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
34 views1 page

Engineering Economics Examples

Uploaded by

Lopoe Miyao
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 1

Engineering Economics: Solved Examples &

Applications

Example 1: Future Worth


If you invest ■10,000 at 8% annual compound interest for 5 years, the future worth is: F = P(1+i)^n =
10,000(1+0.08)^5 = ■14,693.28

Example 2: Present Worth


What is the present worth of ■50,000 to be received after 10 years at 10% interest? P = F(1+i)^-n =
50,000(1+0.10)^-10 = ■19,270.27

Example 3: Annual Worth


Convert a present investment of ■100,000 into an equivalent annual cost over 5 years at 12%. A =
P(A/P,i,n) = 100,000(0.2774) = ■27,740

Example 4: Depreciation (Straight-Line)


Asset cost ■500,000, salvage value ■50,000, life 10 years. Annual Depreciation = (Cost - Salvage)/Life
= (500,000-50,000)/10 = ■45,000

Example 5: Break-even Analysis


Fixed Cost = ■200,000, Variable Cost = ■50 per unit, Selling Price = ■100 per unit. Break-even
Quantity = FC / (SP - VC) = 200,000 / (100 - 50) = 4,000 units

You might also like